The city’s Department of Health yanked its three-year
contract last November after just one year — but that did not stop its executive
director and his top aides from taking bonuses that virtually doubled their
salaries.The long-time NMPP
chief, raked in at least $71,300 in additional “bonus” pay. The NMPP’s
chief financial officer jumped even more than the exec between December 2014
and last July — collecting at least $87,000. The nonprofit’s Human
Resources administrator also took in at least $23,900 in “bonus” payments, and
her niece, who served as exec' s secretary, received $20,000, the financial
records show.

In all, the quartet divvied up
roughly $200,000 between December 2014 and last July, according to the
documents.

Records show that city Department
of Health and Mental Hygiene funds earmarked for an “infant mortality reduction
initiative” were used to pay bonuses to exec and his CFO.

The contracts with the city
specifically state that the city has to be notified if a vendor is even
considering paying a bonus and explain why. This was not done.

“On the Inside” initially reported on Drummonds and
the NMPP in April 2014,revealing that
Drummonds tried to cover up his hiring of career criminal Daniel Rodriguez —
without conducting a background check — as a case manager. Rodriguez preyed upon the women he was hired to help,
fathering a child with one and nearly costing another her children to foster
care, as DNAinfo previously reported.

Saturday, February 20, 2016

exposing the crisis in nonprofit
fraud leadership…a crisis of pervasive and monumental waste, fraud, abuse,
mismanagement, and malfeasance throughout the charitable sector which
costs taxpayers and contributors tens of billions of dollars annually;
and,

seeking reforms that will restore
the public’s lost confidence in the sector.

What’s Included:

Skunk of the Month:

Enormous School Fraud;
Ebola Funds Missing

Breaking
the Silence:

‘Hero Cop’ Embezzlement

Charity Check Up:

More Veteran
Charity Thefts

A Thought or Two:

John
and Aliesa Price Foundation; Cancer Charity Dissolved

Nonprofit News-In Case You Missed It:

Second Mile (Penn State);
American Red Cross; Livestrong…more

Political/Official Chicanery:

VA; IA; WI; NC; CA; NM; OH; MI…more

What Do You
Think?

·To do good, donors must do their homework

·Give without being taken

Examples of(charity) corruption abound…Even existing
laws and regulations don’t seem to help…In his article titled"Follow the Money",
Steven Malanga, senior editor of City
Journal, calls nonprofit corruption a "disease." As Diana
Aviv told The
Chronicle when stepping
down last fall as the head of Independent Sector, we need to speak bluntly
about the wrongdoers in the nonprofit world. The burden falls to us, as
leaders, and to our boards of directors to make transparency a priority. (Chronicle
of Philanthropy) (Aviv and IS did little to stem the tide of
wrongdoing)

“These fundraisers are brazen con
artists who refuse to follow the law and continue to fundraise illegally in
spite of a previous court order,” Illinois Attorney General Lisa Madigan (source)

Trending:Reported
fraud in Scotland rose 80.9% while the
UK increased by 110%. "Theft and cash fraud is by far the most common
method of defrauding a business. It is largely motivated by greed and to
fund a lavish lifestyle. These reasons accounted for 67.8% of all frauds
followed by gambling, which made up 14.58%, then debt accounting for
8.14%. (source)

Skunk of the Month…

“They came to
do good and they did very well indeed (for themselves).”

Skunk of the Month is the twice-monthly designation
made by Nonprofit Imperative, the
organization dedicated to eliminating waste, fraud, abuse and mismanagement in
nonprofits and government. The Skunk of the Month award is given to
charities and government officials who show blatant disregard for the interests
and trust of contributors and taxpayers. This month’s example is:

A
Glimpse Of School Fraud: A True Shame

1.Marksville
(LA) high baseball coach has been sentenced for embezzling thousands of dollars
from the group he used to work for.

2. The Janesville School District changed its money-handling procedures in
response to the embezzlement of more than $300,000 from Craig High School over
10 years.

3. A former Independence High School secretary has pleaded guilty to a
felony theft charge for embezzlement.

4. A school
employee in Tazewell County (VA) has been sentenced to fiveyears in prison on charges of
embezzling more than $350,000 in school funding.

5. A Johnston High School (RI) science teacher is accused of embezzlement
and counterfeiting for allegedly putting his name on checks made out to the
school for student activities.

6. A former
Florida State professor has been convicted of stealing $650,000 from a business school fund set
up to teach students about investing.

7.A Tracy woman is accused of taking $48,979 from
the kindergarten-through-eighth-grade school’s PTO fund and mismanaging a
second PTO account belonging to the teachers while she was the PTO treasurer
from July 19, 2010, to July 1, 2014. She is a mother of a child in the
district and a volunteer with the group

8.A Mississippi woman embezzled $12,000 Bay High School band students

9.A parent volunteer with the Sunnyside School District (WA) is accused of
stealing thousands of dollars from the PTA.

10. A man is accused of embezzling up to $50,000 from a Midland (MI)
preschool has entered into a plea agreement that could leave him with a
misdemeanor.

11.The former transportation director for the Shaw School District (MS)
pleaded guilty to one count of embezzlement.

12.A high school teacher in Rhode Island has been charged
with embezzlement after allegedly putting his name on checks meant for school
activities.

13.The former
treasurer of the Kelly School Parent Teacher Organization (CA) is accused of
embezzling $48,979 from the organization.

14.Former Laurel Christian School (MS) Headmaster pleadedguilty in court to his indicted
charge of embezzlement in excess of $25,000

15. A former
officer manager in Orange (CA) has been charged withembezzling up to $300,000 from a Catholic school
fundraising program and using the cash for designer clothes and private school
tuition.

16.Federal
prosecutors said a former South Carolina public charter school director
used shell companies to embezzle more than $1 million in federal funds provided
to the school for food and educational purposes.

17. A Glendale (AZ) high-school bookstore manager was indicted afterstate investigators claimed she had
embezzled more than $70,000 through a skimming operation that lasted for years
at Independence High School

18.A 20-year
Decatur Schools employee has stepped down after she was charged with
embezzlement

19.Cumberland
County authorities said that they have charged a former Parent TeacherOrganization president with stealing
from the group.

20.The former
director of an East Lansing (MI) preschool has been charged with embezzling
from the school.

21.A former Vermont principal of the year is facing charges of stealing
from his current school.

22.A former
Winslow (NH) woman pleaded guilty to embezzling thousandsof dollars from a school sports team
and a sports boosters’ club, while also stealing state welfare benefits.

23.A Sandy Ridge
P.T.A. President is accused of stealing money from theelementary school.

24.A secretary at
a Long Beach Catholic school was sentenced for stealing more than $260,000 from the school

25.The former
president of the Grady A. Brown Elementary School PTA(CA) was arrested and charged with embezzlement

26.A former
Northampton County (VA) School Board employee who said he“accidentally” sold items from the
maintenance department on the Internet auction site eBay has pleaded guilty.

27.The former
treasurer of the Carter High School Band Boosters Clubpleaded guilty to embezzling more than $33,000 from club
funds.

28.A former
parent-teacher council treasurer wept as she told a judge howsorry she was for wiping out the annual
budget of the organization in a yearlong embezzlement scheme.

29.A Raleigh
man was arrested on a charge that he stole more than $44,000from a Cary school that helps children
with developmental disorders.

30.A former Valencia High School (CA) varsity baseball coach faces felony
charges he embezzled money from the school and from a baseball booster club
over 6 years.

31.A former
production manager for the Music, Dance and Theater Department atNew Jersey City University was
sentenced to three years in prison for embezzling $87,600 from the school.

32.The former treasurer of Mona Shores' Campbell Elementary School Parent
Teacher Organization has been scheduled for a guilty or no-contest plea to
embezzling $46,000 from the organization.

33.Former Harrisburg Area Community College Vice-President Nancy Rockey was
sentenced to 15 months in prison for stealing $233,000 from the school.

34. Ukiah Unified
School District officials suspect the district’s adult school has lost$90,000 over three years because of
embezzlement by a former employee.

35.A former
Southern California school district accountant was recorded on videostuffing lunch money into her bra has
been sentenced to five years in county jail for taking $1.8 million taken from
the Rialto Unified School District over 8 years.

36.A former
Harmony school secretary was arraigned on a felony charge accusingher of embezzling $23,823.44 from the
Child Nutrition Fund. She was employed by Cushing Public Schools between August
2008 and February 2014.

37.A former
College of Southern Idaho employee has been charged with grand theftafter allegedly embezzling money from
the school. She is accused of five felony counts. She allegedly stole
$530,556.29 fromthe college over
five years. (Nonprofit
Imperative) (source)

Billions In Ebola Funds Unaccounted For

At least a third of the
$5.8 billion pledged in support of West African communities devastated by Ebola
have yet to be delivered, while the funding that has been disbursed is nearly
impossible to track, an analysis byOxfam Internationalfinds.

Six months after theInternational Ebola Recovery Conference— where $5.2 billion was pledged for
Ebola recovery efforts in the region — there is scant information available
about the $3.9 billion that has been allocated. "We know that $1.9 billion
of the promised funds have not even been committed to a specific country, but
we can't say for sure how much of the remaining committed money has been
effectively delivered,” said Aboubacry Tall, Oxfam's regional director for West
Africa. "A lack of transparency throughout the whole process, from donors
to implementing organizations to programs on the ground, means we're finding it
hard to understand which donors have given what money, to whom, and for what
purpose."

Breaking the Silence:

A grand jury indicted the widow of adisgraced
Illinois copforembezzling
moneyfrom the same
youth charity her deceased husband did. She and her husband
Joseph embezzled money from the Fox Lake Police Department’s Explorer youth
charity account.

The husband is believed to havekilled
himselfbecause he
thought that he was on the verge of being discovered for stealing from the
fund. His death resulted in a massive manhunt for his imagined murderers in
September along the Illinois-Wisconsin border. Authorities believe that this
was a “carefully staged suicide” to fool them into believing that the husband
(“Hero Cop”) was killed in the line of duty.

The Sheriff’s Department said that
the couple stole thousands to pay for their lifestyle. The pair spent the money
over seven years to pay their mortgage, travel to Hawaii, dine out at
restaurants, a gym membership and adult websites, according to officials. (Time)

Charity Check Up:

Another Vet Org. Gets Caught

The executive
director rappels down buildings and rides a Segway into an annual
conference meeting that reportedly cost the nonprofit $3 million dollars. The
organization hasspent millions a year on
travel, dinners, hotels and conferencesthat often seemed more lavish
than appropriate. Former Wounded Warrior Project workers recounted
regularly jetting around the country for minor meetings, buying business-class
seats or staying in $500-per-night hotel rooms.

In 2013, they were
given a D rating by Charity Watch partly due to its low proportion of revenues
devoted to program activities. Program activities were reported as
accounting for only 43 percent of the charity’s spending

Veterans’
organizations are notoriously poor in their
management. Compared to other veterans’ organizations, Wounded Warrior is
giving less to the people it serves. For example, CBS News reported that
Disabled American Veterans Charitable Service Trust spends 96 percent of its
budget on vets. Fisher House devotes 91 percent. But according to public
records reported by Charity Navigator, the Wounded Warrior Project spends only
60 percent on vets.

The charity has
increased fundraising spending an average of 66 percent every year since 2009;
the nonprofit spent more than $34 million on fundraising in 2014, according to
tax records.

Executive director
Steven Nardizzi has a record of fighting against financial transparency in
nonprofits. Nardizzi is on the advisory board of the Charity Defense Council,
an organization that advocates for less oversight in spending for nonprofits
and promotes high fundraising costs and high salaries for nonprofit executives.
Nardizzi himself makes $473,000 in compensation.

Despite demands for retractions, theColumbia
Journalism Reviewnoted
that the reporting appears rock-solid,
saying that both news organizations, CBS News and theNew
York Times, spent months on the story, rifling through public
documents and speaking with key sources inside the charity and out. They each
interviewed roughly 50 current and former employees. And the journalists’
conclusions line up: While the nonprofit publically says it devotes 80 percent
of its fundraising revenues to services, the news organizations found it was
closer to 60 percent.

Nonprofit Imperative
joins the late Rick Cohen, nonprofit advocate and national correspondent
for NPQ in urging those
concerned about veterans’ issues to bring more oversight to the growing number
of organizations serving them and their families. He suggested that a task
force be put together to review and “scrutinize” organizations claiming to
serve and to focus on issues that are priorities to veterans, to create a
working group to focus specifically on veterans charities (like a GuideStar or
Charity Navigator for this particular segment of the nonprofit sector) and to
create a veterans charities hotline. The hotline would allow skeptical donors
to obtain unbiased information on the work of the organizations that claim to
serve this community of service men and women.

More Vet Charity Fraud: MarylandSecretary of State announced
that the Office of the Secretary of State has shut down a purported charity for
veterans which allegedly falsified marketing materials and other documents and
has not accounted for donations. The AG issued a cease-and-desist order
against the Southern Maryland Veterans Association, along with its principal
and former associate.

The charity appeared to collect thousands of dollars in 2014 and 2015 in
cash and donated goods, but investigators could not immediately determine the
exact totals of contributions and their use. The cease-and-desist order alleges multiple
violations of the Maryland Solicitations Act, including misleading potential
donors to a charitable organization, using false and misleading advertising in
connection with a solicitation and failing to register with the Secretary of
State before soliciting.

A Thought or Two:

Family, Board, Benefit Heavily From Foundation

A news-press investigation uncovered the president, treasurer
and trustee of the John E.
and Aliese Price Foundation spent over 70 percent of its income on salaries and
administrative expenses. With $8.99 million in assets and one full-time
employee the foundation dispersed each year, on average, a mere $225,000
divvied up among 35 nonprofit organizations. Records show some that
got grants had their nonprofit status revoked by the IRS. The board
members, who included exec’s wife rubber-stamped executive decisions in
30-minute meetings held twice a year. For their service, the five other
trustees were paid $8,000 a year.

The foundation
purchased computer equipment and furniture for the president’s home office even
though the foundation office is fully furnished and had three workstations. The
foundation also purchased upscale cars for the exec’s use.

Many of the loans
given by the foundation, according to IRS records, do not appear to have been
paid back.

Foundation Board
member Russell Priddy, who is married to the founder’s granddaughter, accepts
that the oversight has been scant. “The financial information the board is
furnished with is a very collapsed version of a balance sheet and income
statement,” Priddy said. “There’s a dollar figure on there and financials, but
we were given no breakout.”

Remember the IRS states, “(a) private foundation must not be organized or
operated for the benefit of private interests... No part of the net earnings of
a section 501(c)(3) organization may inure to the benefit of any private
shareholder or individual.

Finally Cancer Charities Dissolved

The Cancer Fund of America, a self-described charity based in Tennessee,
has tentatively agreed to dissolve after a court battle with the Federal Trade
Commission and the attorneys general for all 50 states. It joins The Breast
Cancer Society and The Children's Cancer Fund, both also went out of business.
The dissolution of this final "family" of cancer charities, listed by
CNN and The Tampa Bay Times as some of the worst in the United States, comes
after years of reports in which CNN tracked down fake donations, faulty record
keeping and confronting charity directors for collecting millions on donations
without showing any real benefit to people suffering with cancer. The charities
raised more than $180 million over the years, and the FTC said almost none of
it was recoverable. Some of it went to such things as Caribbean cruises and trips to Disney World. (source)

1.The charity, Second Mile,
founded by convicted former Penn State assistant football coach Jerry Sandusky
has filed a court petition seeking permission to go out of business.The
charity's board says fundraising has dropped to nothing and nearly all its
assets have been distributed in the wake of Sandusky's arrest and conviction on
charges he molested several boys, including some he met through the charity. (WJAC-TV)

2.As
Nonprofit Imperative has previously
noted Rep. Bennie Thompson, the ranking member of the House homeland security
committee, sent the charity a long list ofquestionsafter ProPublica recently
revealed the cuts and detailed how they haveeroded the Red
Cross’ ability to respond to even modest disasters. Red Cross CEO Gail McGovern responded in aletterlate last month that she has tried to lower “the costs of
delivering our services to the public — without diminishing the services
themselves — and we believe we have achieved that goal.” Citing an alarming degree of
frustration in West Virginia with
American Red Cross’ performance, Rep. Bennie Thompson (D-MS) wanted to know if
ARC performed an after-action assessment of its response to recent disasters
and how it will address the challenges it experienced responding to the
incidents in West Virginia and California. In an article in Emergency Management (reprinted
from the (Register-Herald) reveals that two years ago in West Virginia, seven
Red Cross chapters were collapsed into four. Red Cross is a designated support
agency under the National Response Framework's Emergency Support Function 6-the
federal government's plan to provide life-sustaining resources and essential
services when the needs of disaster survivors exceed local or state
government's capabilities. But McGovern did not
answer basic questions about the cuts, including how many actual chapter
offices she has closed. McGovern also ignored Thompson’s question about how
many emergency planners have told the Red Cross they are no longer
incorporating the charity in their response plans. Thompson,
who has been pushing formore oversightof the Red Cross, told
ProPublica that he is “troubled” by the lack of answers.

“I am troubled that questions were ignored and some
of the responses provided were inconsistent with information from numerous
media reports,” Thompson said in a statement. “I will continue my oversight of
the Red Cross and will not stop until all questions are answered. In
2014, McGovern tried tokilla investigation into the charity
by the Government Accountability Office. After that failed and the inquiry went
forward, the Red Cross didn’t providefull accessto the government investigators.
(ProPublica)Update:The American Red Cross
ran a deficit of $159 million last fiscal year, battered by a steep drop in fundraising and
its struggling blood banking division, according to newly released financial
statements. But the new financial statements show contributions to the Red
Cross fell to $604 million, about $120 million (or 20%) less than the previous
year. It is the worst fundraising result the Red Cross has had since at least
2000, the last year for which ProPublica could find financial records. (ProPublica)

There is a growing
number of counties dropping regional Red Cross participation from their
emergency operational plans, and, according to ProPublica, to local
United Ways withdrawing their funding from those regional entities.

4.The chief executive and president of Livestrong resigned after less than
a year on the job, another blow to the cancer foundation that has struggled
with sharp declines in donations and revenue since founder Lance Armstrong's
performance-enhancing drug use scandal. Livestrong
had two straight years of sharp declines before ChandiniPortteus
took over in early 2015 at an annual salary of $350,000. According to federal
financial records, Livestrong's 2013 donations dipped from nearly $23 million
to $15 million after Armstrong's televised admission of drug use. It also took
a 38 percent dive that year in commercial revenue after sponsorships were
canceled or not renewed. Livestrong's 2014 financial report, filed at the end
of 2015, showed a further 29 percent drop in revenue and donations down to less
than $12 million. The report also noted a $10 million dip in total assets.

5.Charitable donations grew for the fourth year in a row in
2015, although at a slower rate than in previous years. Giving grew 1.6 percent
last year, compared with 2.1 percent in 2014 and 4.9 percent in 2013, according
to thereportby the fundraising
software company Blackbaud.

6.Gambling and Charity Fraud: 1.)
A federal court charged formerNFLwide
receiver Reggie Ruckerwith wire fraud and making a false
statement to law enforcement. It is alleged that he had taken money from a charitable
fund to settle gambling debts and other personal expenses. He served as
executive director of the Amer-I-Can charity. Using the charity's bank account,
he allegedly helped pay his mortgage in addition to paying for meals,
groceries, travel expenses and dry cleaning. He is also accused of withdrawing
more than $48,000 from casinos in Cleveland, Las Vegas and
Tampa, Florida, and in total, paying roughly $65,000 in gambling debts from the
Amer-I-Can fund. Authorities charged Rucker with taking
nearly $500,000 from the charity between 2011 and February 2015. 2.) The former
executive director of the Miracles Club has been indicted on accusations that
he embezzled $144,000 from the Northeast Portland nonprofit, then gambled away
much of the money at the Spirit Mountain Casino. He has been appointed
the Miracles Club's interim executive director. It's unclear when Bryant left
his job as executive director. Miracles
Club leaders are working to tighten controls.

17.Local 164 of the International Brotherhood of
Electrical Workers (NJ) $145,000

18.Piedmont Triad Partnership, Inc (NC) $240,000

19.Westland Hockey
Association (MI) $45,000

20.Somers Lakeside PTA (MT) <$5000

21.Louisa County Athletic Boosters (VA) unknown

22.Hemet (CA) Synagogue $250,000

23.Americans Helping America Chamber of Commerce (CA)
many thousands

24.La Center Little League (WA) <$25,000

25.Janesville Craig High School (WI) $300,000

Political/public official chicanery(just a few):

1A former Christiansburg
police officer will serve a year in jail for embezzling close to $34,000 from
the nonprofit Virginia Bloodhound Search and Rescue Association, according to a
special prosecutor.

2A former Garwin (IA) city clerk, previously charged in state court, is
now charged in federal court with embezzling over $560,000 from the city and
will plead guilty.

3The former Eau Claire
County (WI) treasurer, was sentenced to 9.5 years of initial confinement,
11 years extended supervision and probation. He was ordered to pay restitution
costs of $625,758.22 from the county.

4A former city of Charlotte employee, who worked in
the city manager’s office, was arrested on five counts of felony embezzlement.
Weak supervisory oversight allowed the thefts to continue over a period of at
least four years.

5Former volunteer treasurer for California CongressmanDana Rohrabacherwas arrested on suspicion that he
embezzled more than $200,000 from the congressman's campaign chest and also was
accused of embezzling more than $80,000 from a former employer, the Orange
County district attorney said.

6Juanita
Roibal-Bradley, a former New Mexico Workers’ Compensation Administrative Law
Judge, admitted in federal court Tuesday that she siphoned more than a
half-million dollars from an estate – after she’d been disbarred by the New
Mexico Supreme Court. She also pleaded guilty to defrauding the Social Security
Administration of more than $40,000 by receiving disability benefits.

7The
former director of the Macon County (NC) Board of Elections pleaded guiltyto embezzlement in federal courtto
writing $72,000 of unauthorized checks for her
own financial benefit.

8The Columbus (OH) City
Council has awarded a $100,000 contract to fight infant mortality to
a nonprofit agency headed by a former council member who resigned last year
amid ethics questions. Days after resigning her seat at the urging of her
attorney handed over records to the U.S. Department of Justiceas part of an investigation into whether she had
accepted free dinners or gifts, several sources said at the time. The
federal investigation continues. The awarding of the contract also comes as the
ethics commission has opened an investigation into the city's approval of
contracts to nonprofits that also employ council members.

9The
treasurer and wife of the Davidson County (NC) Sheriff’s Office chief deputy is
facing multiple charges involving allegations she embezzled in excess of
$350,000 from the Welcome Fire
Department.

10The Assistant Fire Chief of the Lincolnton (NC)
Fire Department has been indicted for embezzlement in connection with the
Burned Children's Fund.

11Two Congressional
committees are demanding data from the country's wealthiest universities on how
they spend their investment funds

12A Grand Valley State
University (MI) employee has entered a guilty plea to accusations of taking
$50,000 from the university.

Nonprofit
Imperativegathers
its information principally from media sources...some of which are directly
quoted. Virtually all cited are in some phase of criminal proceedings; some
have not been charged, however there is money missing. These incidents include
only a fraction of the estimated $40 billion of charity crimes. On rare
occasions, there may be duplicates.

Gary
Snyder is the author of Silence: The Impending Threat to the Charitable
Sector (Xlibris, June, 2011) and Nonprofits: On the Brink
(iUniverse, February, 2006) and articles in numerous publications. The book can
be bought at amazon.com,barnesandnoble.com, Barnes and Noble (store)

About Me

Gary Snyder is the author, most recently, of the groundbreaking expose on the charitable sector, Silence: The Impending Threat to the Charitable Sector as well as the often-cited guide on best practices and key concepts, Nonprofits: On
the Brink.

He is the publisher of a
twice-monthly newsletter, Nonprofit Imperative that gives an update on the current status of the
charitable sector.

Snyder is often quoted and frequent contributor to the blog of the National
Committee for Responsive Philanthropy. Snyder twiceauthored the Governance Chapter of the Michigan
Nonprofit Management Manual (4th and 5th editions).

He is a speaker on ethics,
financial and governance matters of the sector. For almost a decade, Snyder is frequently
consulted by Congress and has been quoted in print, broadcast and online media
outlets.